Longtime Shareware Payments Processor Kagi Shuts Down

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Original poster
Apr 12, 2001
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After more than 20 years in operation, once popular software payments processor Kagi yesterday announced on its home page that it has shut down effectively immediately. Longtime Mac users are probably familiar with Kagi, which assisted numerous small developers in accepting credit card payments from users.

Kagi arose in the 1990s on the popularity of shareware, which allowed developers to widely distribute their software with time or feature limits as trial versions and then offer unlock codes for a fee to open up full functionality. Processing credit card payments for these unlock codes was difficult for small developers who didn't have the manpower or financial resources to handle payment issues or deal with setting up merchant accounts with credit card companies, and Kagi provided a solution for those developers by handling the payment processing, code distribution, and development and maintenance of store pages.


With the evolution of payment processing in the form of PayPal and Stripe, Kagi's popularity waned, though it continued to be used by a number of small developers. Ultimately, however, that user base was not enough to sustain the service, with founder Kee Nethery also citing a decade-old case of supplier fraud that Kagi was never able to recover from as a major reason for finally closing down.

Based on the notice posted on Kagi's site and emails sent to developers using the service, a third-party company is "dividing up the Kagi assets and distributing them to the creditors," so it is possible some developers may not receive the full amount they are owed as Kagi shuts down.

Article Link: Longtime Shareware Payments Processor Kagi Shuts Down
 

keysofanxiety

macrumors G3
Nov 23, 2011
9,534
25,264
Not familiar with this company. But reading this on their homepage peaked my interest:

"For the past ten years Kagi has been struggling to recover from financial losses due to a supplier fraud situation. We have reduced the debt but the recovery has failed and forced us to close.


We are sorry we failed you."


:(

Anybody have any information about what supplier fraud situation they're talking about? A Google search didn't seem to throw up much of an answer.
 

Baumi

macrumors regular
Mar 31, 2005
208
244
For anyone unfamiliar with Kagi: Back in the 1990s they were the payment processor for Mac shareware. If you ever bought any Mac software over the net at that time, you most likely dealt with them.
 

SBlue1

macrumors 68000
Oct 17, 2008
1,615
1,859
Wow. I remember that. Haven't read the word "shareware" in a decade or so. I am getting old I guess. :)
 

RichTeer

macrumors member
Aug 13, 2014
93
188
Kelowna, BC, Canada
"For the past ten years Kagi has been struggling to recover from financial losses due to a supplier fraud situation. We have reduced the debt but the recovery has failed and forced us to close.


We are sorry we failed you."
That last sentence reminds me of Zen's last words to the crew of the Liberator (from BBC TV's Blake's 7); I even read it with Peter Tuddenham's voice in my head...
 
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ArtOfWarfare

macrumors G3
Nov 26, 2007
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That last sentence reminds me of Zen's last words to the crew of the Liberator (from BBC TV's Blake's 7); I even read it with Peter Tuddenham's voice in my head...
I'm pretty sure an Aurora Unit says that exact line to you in Metroid Prime 3. And no, I don't have that game's dialog memorized or anything. The only reason it's on my mind is that I'm replaying that game right now, and literally ~12 hours ago I heard that line.

The line is so insignificant, I can't actually find any YouTube snippets or quotes or anything with exactly what it is she says... it's an apology over a malfunction in your suit the first time you get corrupted.
 

CFreymarc

Suspended
Sep 4, 2009
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Anybody have any information about what supplier fraud situation they're talking about? A Google search didn't seem to throw up much of an answer.
There should still be a Slashdot article about this fraud if you can access archives that far back.

What I remember is a supplier had a piece of shareware coded such that is was a Trojan running it's own, non-end user initiated, false purchases with fraudulent and stolen credit card numbers via the Kagi library linked in the app.

Kagi was caught holding the bag of liability to banks that paid out on the transaction. They could no go after the shareware supplier as they were in Asia and outside of extradition.
 
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keysofanxiety

macrumors G3
Nov 23, 2011
9,534
25,264
There should still be a Slashdot article about this fraud if you can access archives that far back.

What I remember is a supplier had a piece of shareware coded such that is was a Trojan running it's own, non-end user initiated, false purchases with fraudulent and stolen credit card numbers via the Kagi library linked in the app.

Kagi was caught holding the bag of liability to banks that paid out on the transaction. They could no go after the shareware supplier as they were in Asia and outside of extradition.
Thanks very much for taking the time to reply! I'll look into that. :)

Best wishes & have a wonderful rest of the week.
 

jettredmont

macrumors 68030
Jul 25, 2002
2,714
307
Sad to see them go. Way back in "the day" I was on the other side of the Kagi divide - selling shareware and using Kagi as my credit card transaction company. They did quite well for me, through three different products, and were always fair, friendly, and stayed completely out of the way when I didn't need them. I've been out of the shareware game for many many years now of course, but even two years ago was still promoting Kagi when talking to developers who wanted someone else to handle their payments but didn't want to deal with one of the app stores.

Ah well. All good things must end at some point, I suppose. I'll pour one out for Kagi tonight (way too early to drink today still).
 
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melgross

macrumors 6502
Jan 23, 2004
345
209
New York City
Kagi wasn't just for shareware. I used them to pay for software for my Samsung i300 Palm smartphone, and later, my Treo 700P.

The problem with Kagi was that it was a real pain to use. There were a number of steps needed, including going back and forth between their site and others. I hated paying that way. I only used them because there was no other way. I'm pretty sure that others felt the same way about it.

I don't know what bice dislikes about PayPal, but it made a lot of things easier. Obviously, eBay, which I've used since 2002, is far better with PayPal than it was before. But now that we will be able to use Apple Pay with websites soon. I'll use that whenever I can.

Since paypal is no longer affiliated with eBay, if eBay accepts Apple Pay, ill use that there too.
 

MacGizmo

macrumors 68000
Apr 27, 2003
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Arizona
I never liked Kagi, and avoided purchasing apps that used their payment/license system. I'm surprised they stuck around this long.
 

PaulRustad007

macrumors 6502
Jun 3, 2015
390
353
Not familiar with this company. But reading this on their homepage peaked my interest:

"For the past ten years Kagi has been struggling to recover from financial losses due to a supplier fraud situation. We have reduced the debt but the recovery has failed and forced us to close.


We are sorry we failed you."


:(

Anybody have any information about what supplier fraud situation they're talking about? A Google search didn't seem to throw up much of an answer.

http://tidbits.com/article/16665
 
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